16th > June > 2000 Archive

MPAA's Valenti testifies in 2600 suit, claims to know nothing

Motion Picture Association of America (MPAA) Chairman Jack Valenti gave a deposition on Tuesday for the US District Court, in the MPAA lawsuit pending against 2600.com over linking to sites where the DeCSS utility, which cracks DVD encryption, can be found. We were immediately impressed with Valenti's near-heroic ignorance of the issues surrounding the suit as 2600 lawyer Martin Garbus questioned him. A crucial issue for Garbus was the inconsistency in the Digital Millennium Copyright Act (DMCA) which makes it a crime to skirt access controls while at the same time purporting to preserve the Fair Use exception. When access controls are used to protect copyrights, as they are in DVD's, the result is a contradiction with Fair Use, which Valenti insists he cannot grasp. "Did you testify before Congress that the Fair Use Exception was not cut out by the DMCA," Garbus asked. "Yes," Valenti assured him. "The concept of Fair Use is intact in the DMCA." "Tell me how that is," Garbus urged him. "Well, I don't know except that the concept is intact." An apparently incredulous Garbus pressed the matter: "Do you agree that a person teaching in a classroom can take three, four, five minutes of a DVD and play it to his class?" "If you mean can he de-encrypt it the answer is no, but he can get a DVD and fast forward to the three or five minutes he wants to play," Valenti noted. "So if a librarian, for example, wants to [snip] two to three minutes [from a DVD] for a lecture, is she required to get a license from the DVD CCA or the MPAA to use those two or three minutes?" "I can't answer the question," Valenti said. "Why not?" "Because I don't know what the answer is." "Do you understand the question?" "Huh?" "Do you understand the question?" "Not really." A pretty good snow-job, we must admit, and pleasantly reminiscent of deposition grandmaster Bill Clinton's touching uncertainty over "what the meaning of 'is' is." Of course Valenti knew precisely what Garbus was playing at, trying to get him to admit that an access control effectively makes it a crime to exercise Fair Use, if Fair Use means whacking out a snippet from a DVD. One would, of course, have to decrypt it to do so. "If you circumvent or de-encrypt to make Fair Use, is that MPA policy as being against the law," Garbus asked, still trying to trap him. "I can't draw a legal conclusion," Valenti replied. And there Garbus had got him. Valenti has drawn legal conclusions on that question: "Did you testify before Congress on the scope of Fair Use?" "I may have; I don't recall," Valenti said. And so it went, for what seemed several hundred paragraphs. Turning his attention briefly to MPAA claims that DeCSS causes real economic damage to the film industry, Garbus produced a document bearing Valenti's signature. "[In it] you say, 'Piracy is a $2 billion a year worldwide problem and growing.'" "Uh-huh." "Can you tell me if you have any information about whether one nickel of that piracy loss relates to DeCSS," Garbus inquired. "I don't know," Valenti repeated again. Valenti's full deposition, minus a few redacted secrets, is available on the 2600 Web site. It's a most entertaining read, at least for those who enjoy legal manoeuvring for its own sake, and can appreciate the delightfully lyrical effect achieved by a mesmerising repetition of the phrase, "I don't know." ®
Thomas C Greene, 16 Jun 2000

HP gives resellers chance to win £1 million

Hewlett Packard is once more planning to make one of its resellers filthy rich. The generous vendor will not only ship its top 60 printer dealers off for a weekend in the South of France, but it is offering one lucky reveller the chance to win a cool £1 million. This couldn't possibly be the same million pounds that was promised by HP last year, could it? In Autumn 1999 HP launched a similar competition called MillionAir, promising to make one of its resellers rich beyond their wildest dreams. It treated a group of them to a champagne party in London's Park Lane before whisking them off on Concorde, where one entrant looked forward to nabbing the £1 million bounty. But due to some hidden smallprint of the competition rules, no-one won the cash. In the meantime, HP generated bank interest and plenty of free publicity for itself. Those in the channel who want to pitch their wits against HP this year should get their skates on - the Millionaire's Club promotion started two weeks ago. Resellers have until August 31 to sell as much HP imaging and printing products as possible. Those who sell the most and answer some HP brain-teasers correctly will get their names entered into a draw to get invited on the trip. HP will foot the bill for them and their partner to stay at a swanky Cannes hotel from October 21 to 22. And one will get entered into a mystery competition to win the elusive £1 million. In HP's words: "After the success of MillionAir, we felt that HP Millionaire's Club would be a great way to continue rewarding the channel for its efforts in selling HP imaging and printing products. "It is a fun way to ensure that everyone is kept up to date on all the latest product range." ®
Linda Harrison, 16 Jun 2000

World IT jamboree in Taipei a wossat

AnalysisAnalysis The World Conference on IT, a two yearly event, opened last Sunday night in Taiwan to dragon dancers, drummers, wicker baskets and rain that drenched anyone that peeked out of the all-over thunderstorm prophylactics supplied by the organisers. While it was undoubtedly a coup for this little island to drag together Bill Gates, John Chambers, the representative for Burkino Faso (who stayed in our hotel) other politicos including our very own Patricia Hewitt, IT people and assorted delegates from 84 countries, by the fourth day of the conference we were scratching our head and wondering what the hell this was all about. Unfortunately for Australia, which hosts the next event two years down the line, many of the media and a chunk of the delegates wondered what the hell the point of it all was. The three working days of the conference were wall-to-wall keynote speeches, which, for the press at least, were punctuated by press conferences which were often better value. Monday: Impact of IT on World Economics The conference was opened by Taiwan's new president Chen, who proclaimed that the country was to be a "green global village" and by that he meant environmentally friendly. "The spirit of respect for nature, concern for people, will gradually be fostered so that technology will not overburden nature during this time of vast development," he said. He also was happy that Taiwan, like mainland China, is on the verge of joining the World Trade Organisation. "All of you present today are the best witnesses and participants in Taiwan's march toward the new century," he said, showing that he, at least, understands the millennium has not yet begun. That day, Monday last, we listened first to MIT's Lester Thurow, who was reasonably good value. He said that half the retail stores in the world will be closed by 2010, in the business-to-business sphere, GPS will soon come down to one metre accuracy and that "if you're not willing to destroy, you can't create". In other words, "you need chaos to get creativity". We hung round for Carleton Fiorina from HP, who appeared festooned in the finest pearls, and duly reported that speech later that day. Stan Shih, CEO of the Acer Group, spoke about organising companies in a different way, based on the Internet economy. Shih has not been very well in the last year or two, but put on a solid performance, and said that Acer itself had formed two separate groups to re-engineer its business activities. Nobel prize winner Robert Mundell's main thrust was that the major Asian economies should create a common currency. But they should base it on the dollar, not the yen. The problem with the Euro was that it was based on the mark, not the dollar. At which point we wondered why the whole economy didn't just base itself on the dollar, and cut out all of this shilly-shallying. The IT industry, for example, is firmly based on the mighty dollar. Ericcson's Kurt Hellstrom's speech was boring, but his press conference was more interesting, as we already reported. Tuesday: IT Strategies, Business Models, Apps Cisco's John Chambers, an ex-Intel guy, startled the Asian press by holding a press conference on Tuesday, at 7.30 am, again in our hotel. He apologised for holding what he understood to be the earliest such event in Taiwanese history, but then launched into a whirlwind presentation which left many of us reeling. Quick Reg Summary: We're in the new industrial revolution which will take 30 years to achieve and we're already 10 years in. He knows every world leader on this planet, and possibly those on other planets too. Tony Blair is a fab guy, so is Clinton even though he's a Democrat. We were all waiting for Mr William H. Gates III, who delivered his "The Next 10 years of Windows" thing. He had a slide presentation for this, but we only managed to get our mitts on this when we crashed a Microsoft Taiwan press conference later in the day. We can report from the latter gig that both IDG and The Register were nearly killed by fevered TV crews and snappers who prevented us from getting photos of said CEO apart from in the first case the back of his head and his right ear, and in our case his nose. Next came Robert Young of Red Hat, whose activities and hosiery we have already reported, followed closely by John Chambers, or as the press there calls him Mr Internet. No way. We'd had enough Chambers for one day. Tadashi Sekizawa, chairman of Fujitsu, promised a strange future made up of underground tunnels all connected together which would deliver goods all round the world. We wanted to hear more about this but unfortunately Sekizawa San didn't hold a press conference. Joe Tucci, EMC's president, was next, but we were too busy talking to other delegates to discover what's new and exciting in storage. The afternoon session started with Mr George Newstrom, EDS corporate senior vice president, who spent much of his keynote speech talking about how many emails a day he got, and totally neglecting to mention a profit warning which seemed to be highlighted in that morning's Asia Wall Street Journal. Corel's Michael Cowpland was next. According to Cowpland, StrongArm and Transmeta had decked Intel's monopoly. There was light at the end of the tunnel. We reported his press conference from the conference. Isn't StrongArm an Intel product though, we wondered... Wednesday: IT for a Better World Dr Michael Dertouzos, director of MIT Labs, ducked out of the conference first thing, which was a shame. But the mayor of Taipei, Ying-jeou Ma, was good value on Building the Taipei Cybercity. He vouchsafed that his mother, 80 years of age, was an avid Internet fan, (Hi, Ma's Ma) but as she lived in an apartment next to his, frequently didn't reply to his emails but just popped in for a natter. That was followed by our own Patty Hewitt, minister for small businessmen and e-commerce. She painted a picture of the UK as an Internet paradise, as we've already reported. But at a press conference later on, she confessed that not all gov services would be online by 2005. Legacy IT systems inherited from the previous Labour government prevented rapid implementation. Plus the social security benefits system was unlikely to hit that 2005 target. So now you know. Unfortunately, we missed Risto Linturi from Finland, who talked about life in the information society. But here's some facts for our own Patty Hewitt: "Between fifty and 70 percent of Finns use the Internet weekly, with over 30 per cent having a working Internet connection at home. Over 95 per cent of people between the ages of 15 to 60 have mobile phones, with over 50 per cent of families having more than two mobiles. Over 90 per cent of all government and authority services are online now, while every form for taxes and other government departments are already available online. The Finnish government has donated two billion sterling for a Future Packet to make the Internet better, and typical Internet rates are a fiver a month for unlimited access, with each Finnish sould paying five pence a call and a penny a minute. As one delegate said: " It seems that Finland is now what UK wants to be in 2005. Or, Patricia thinks that western Europe lies west from Berlin." We missed Doctor William P. Magee, founder of Operation Smile Inc and had to high-tail it out of Old Taipei. Summary Most of the delegates we spoke to had their doubts about the thousand bucks they'd paid. First of all, the congress was wall-to-wall keynotes. One Indonesian delegate said that there were not enough workshops. In his country, for example, there were 15 different comms standards and there was little real talk about the Internet. A delegate from Sweden said he believed the real function of the congress was as a major spin and idea laundering event. It let government leaders be seen next to IT leaders, and so gave the clear impression that the world was doing something. Education was high on the agenda, but we couldn't help wondering if cyber-education is on balance a good or a bad thing. A CIO of a major US PR company (Edelman), said that he thought the congress was a good thing because it would give him a broad brush view of the way the industry was going. The delegate from Burkino Faso refused to comment when we cornered him in the lift in our hotel. You can find more info about the congress here. ®
Mike Magee, 16 Jun 2000

Sun steps up to the SAN trough

One of the most interesting tidbits we heard yesterday was that Sun is making more money from its storage business than it is from servers. Officially, Sun won't say one way or the other, but if that's really the case, then it's not alone. There are plenty of snouts in this trough - a business which, as we've pointed out before - has been denying the laws of gravity for far too long. So Sun has duly revamped its storage line-up, but it leaves its fellow feeders pretty much as they were before: EMC still quotes astronomical list prices for closed boxes which can only be opened by EMC-certified staff, and still makes a poorly documented and only partial API available to hand-picked ISVs for a tidy $35,000 a time. Veritas can still charge premium pricing for its volume manager, and the switch vendors can continue to demand - and get - exclusive deals from their customers as no two switches can be guaranteed to work together. And lest we forget, this also creates a nice lucrative sideline in 'Switching Interoperability Labs' - just so the storage is supposed to work as it should. Yup, that's the cost of parking in this town. But Sun does seem to appreciate that hooking up a few pesky disks is going to become a service business, sooner or later, with the technology completely commoditised. But for now it suits everyone that it isn't. On Wednesday, Sun could claim that its new kit was cutting around 79 per cent off EMC's prices for equivalent storage, based on a list vs list comparison. For example, 10Tb of EMC costs a cool $4.6m, and with Sun T3s, that now comes in at $1.7m. However, EMC's list prices bear as much resemblance to reality as IBM's list prices - it's got more fat to burn off before it feels the pinch. In a nutshell, Sun has taken certain bits of disk management software from its proprietary rebadged boxes and put it in Solaris. The goal is to manage anything from the OS, naturally. Ancor is the favoured switch vendor, and Veritas the favoured management software (Sun already sells a rebadged Veritas lvm) so it has something to sell right away. The management stuff is pretty neat - instant database snapshots are available right out of the box, which isn't new for the industry, but is new for Sun. Sun has signed up fifty partners for Jiro, the policy management layer, and that's supported by the biggies. The rest will trail along soon: support for storage on NT 4.0, HP-UX and AIX is due by the autumn, and for Linux and Windows 2000 by the end of the year. The remaining big switch vendors - including Brocade - should be compliant by then too. So what's the problem? Well, we can't help thinking that the buccaneering Sun of old would have used the occasion to really set the cat amongst the pigeons. For example, by announcing that it was hacking away at EMC's APIs, or cooking up a cluster file system that wrapped around DiskZilla's horribly big boxes. There are plenty of bright folk at Sun who'd be willing to have crack at this - we know this because we know them and they tell us as much. But this loss of nerve isn't all Sun's fault. The commodity bits aren't quite there yet, or at least not where for a Dell could step in. For example, Infiniband is too young to feature in Sun's next generation Serengheti servers, and as Sun's storage VP Ron Lloyd told us, we're therefore stuck with Fibre Channel interconnects, a spec that's been loose enough to allow the switch vendors to write it all their own way. On the other hand, we still don't think - and flame us now, guys - that Sun really gets clusters or cluster file systems. So although Ed Zanders is right in picking out Compaq as a rival that's really got the hang of distributed storage, it's not as distributed as it could be. To any sane buyer, the cost of parking your data somewhere - and that's a right, not a luxury - remains absurdly high. But the short-term gain looks too great for Sun to resist. ®
Andrew Orlowski, 16 Jun 2000

Cadence goes back to the future

Semiconductor design is about as far out on the leading edge of technology as you can get (excluding the i820 chipset, naturally). And it even sounds pretty cool, too (until you get talking to the average chip designer, when that facade falls away all too quickly). Top chip designer Cadence prides itself on laying on something pretty cool for its favoured journos (not The Register, obviously) at the annual DAC conference – last year it was in New Orleans where the entire Big Easy Police Force was hired - complete with Harley-Davidsons, flashing lights and sirens - to escort hacks luxuriating in the comfort of stretch limos with fully-stocked minibars from a private viewing of the Degas exhibition at the local museum of modern art to a slap up meal in one of the town's top restaurants. Not bad. So when Decadence took a bunch of hacks out for their annual pissup at DAC in LA a couple of weeks back, something well radical was on the cards. This year, hacks had heard whispered mentions of the name "Huey", and being largely aged under 30, were dribbling at the prospect of a private gig from The Fun Lovin' Criminals, but obviously wires had got crossed somewhere and the band that showed up was, rather unfortunately, not the ultra-cool Kings of New Yoik, but superannuated rockers Huey Lewis and the News. All together now: "Tell me doctor, where are we going to this time? Is this the future, or 1969?" ® Register quizoid: In which British pub rock band did Huey Lewis appear before becoming famous, and in which British pub rock band does he play now, and wasn't he one of the bad guys wasted by Bruce Willis in Die Hard? It was him, I swear it, he… [That's enough nostalgia – Ed]
Andrew Thomas, 16 Jun 2000

How the hell… do you overclock the AMD T'bird?

Well that didn't take long: K7oc has successfully overclocked the new Athlon Thunderbird, cranking up the speed from 700MHz to 850MHz. You can read the review here. That certainly removes one question mark over the New Athlon - as the Thunderbird is now officially known. Many overclockers were anxious that the capability to overclock the chip would be severely curtailed. The New Athlon is found only with Slot A processors - and the implication for overclockers is that they could not get cranking up using simple chips -as OEMs would sell these as part of complete system solutions. Instead they would have to buy a complete system, to take advantage of regular GFDs (Golden Finger Devices). Certainly, there is more potential for overclocking with the New Athlon. The Slot A version of Thunderbird looks just like a regular Athlon, but without cache chips on the sides of processor PCB (remember, the New Athlon has on die cache). This could make one infer that the New Athlon is more overclockable then regular Athlons - just like it was (or was supposed to be) with Pentium III CuMine processors. AMD refutes this supposition - it declares that such devices cannot be produced because of technical reasons. But then it said exactly the same thing about so-called Slocket adaptors. I understand that some European factories are testing a Slocket adapter for the New Athlon, and I'm told they should hit the streets in six weeks or so. But there is still some mystery - is this adaptor going to have AIC (Athlon internal connector), the connector which was mainly used to attach this Athlon overclocking device? Soon we can expect to see some solutions for the Socket A processor and, if it's possible to make a Slocket converter. This would also probably include support for AMD's cheapo Duron processor. So let's be optimistic that we will see such solutions. It would be a shame to see a great tradition wither away. ® There better had be some kind of Slocket in the offing -- later watch out for a million AMD mobos lost in Taipei - Ed
Fuad Abazovic, 16 Jun 2000

MS tries to cut States out of Supreme Court appeal

MS on TrialMS on Trial We can now reveal why Microsoft decided to split its appeal into separate actions against the DoJ and the Plaintiff States. In Microsoft's response filed yesterday with the Court of Appeals against the States' request that Microsoft's stay motion be dismissed or deferred, there is a note of triumph: "In their zeal to secure direct review in the Supreme Court, the States misstate the Expediting Act... [which] applies only to an action in which the United States is the complainant'". Microsoft is therefore claiming that the States' case may not be taken to the Supreme Court, but there are two possible problems with this view. Whether Microsoft will succeed in cutting out the States will depend on a legal interpretation of whether the complainant can consist of more than one party in a consolidated case, but Microsoft has not exactly helped itself in this matter. The States point out in their brief that: "At the request of Microsoft, which called consolidation unquestionably appropriate' because of the same factual allegations and legal theories' that go to the very heart' of the United States' and States' complaints... the district court on May 22, 1998 ordered the federal and State actions consolidated for all purposes'. "That court conducted a single lengthy trial of this consolidated case, entered a single set of findings of fact, a single set of conclusions of law, and a single Final Judgment in the case. It is from that single Final Judgment that Microsoft now appeals. Accordingly, this proceeding involves appeal from one judgment in an action in which the United States is a complainant, as set forth in the language of the Expediting Act. The United States and the States jointly have filed a motion for certification under the Expediting Act..." The second problem is that the Expediting Act is not very carefully worded, and although Microsoft is correct that Section 29(a) has the provision that the US needs to be the complainant, it is arguable whether the wording applies to Section 29(b), which deals with direct appeals to Supreme Court, because of a provision "Except as otherwise expressly provided by this section..." and which creates doubt as to the intention. This means that Microsoft may be able to spend even more time arguing over trivia. The importance of the States' role has diminished since the final judgement, but to Microsoft it would be a propaganda victory if it could exclude the States. Commonsense would say that there should be one action, and that the States should be part of the DoJ action all the way, but whether the law of equity will prevail remains to be seen. In another filing, Microsoft complained to the Court of Appeals that Judge Jackson's "no appeal, no stay" rule flew in the face of "hornbook law" that "an appellant may seek a stay even before filing a notice of appeal". Well, if so, Judge Jackson made some new law. In perhaps its most arrogant claim so far in the case, Microsoft said it "gave the district court a more than ample opportunity to decide the stay motion, and the district court failed to afford the relief requested". It is unusual for a defendant to act as judge. It appears that Microsoft is jockeying for a further intervention by the Court of Appeals today or on Monday, before it files its response to the plaintiffs' motion to move the case to the Supremes. Microsoft also says that it "should not be faulted" for its faulty two-paragraph motion for a stay, because it thought it would lose anyway. Microsoft introduced further argument that the DoJ's and States' actions should be treated separately, and pointed to the fact that the Court of Appeals had issued two orders on 13 June, which Microsoft would like to be seen as agreement by the court that there are two separate actions. There can be no certainty as to whether this is the view of the appellate court, but Microsoft triumphantly claims that even if the DoJ action is taken by the Supremes, "Microsoft's appeal of the States' case will remain [in the Court of Appeals] and the stay motion must be ruled on in that case. This is wishful thinking, because it is very unlikely that the Court of Appeals would do anything if the Supremes accepted a consolidated appeal - at least until they were sent the case by the Supremes. At least three of the justices seem likely to support Microsoft, with one likely to be opposed, but the views of the others are less certain. Handicappers are already noting that seven of the nine justices were nominated by Republican presidents, which on a simplistic interpretation would suggest Microsoft might well receive favourable treatment. The odds must be that the Supremes would send the case to the Court of Appeals to sort out some legal issues and that these would then be sent back to the Supremes for decision. The critical near-term decision will be over the conduct remedies stay: if Microsoft gets this, it would be a major triumph. If Microsoft wins the skirmish about the States' case being separated and kept in the Court of Appeals, this would also amount to a win for Microsoft in that it would be able to bring up all manner of trivial issues to spin out the case. The legal freneticism is of course also a win for Microsoft's external lawyers, who are paid by the minute. ®
Graham Lea, 16 Jun 2000

AOL makes arms-length messaging concession

Here's an aside for the Ayn Rand-reading equity and buyout specialists who like to swagger around Silicon Valley these days: A Little Government can be a wonderful thing. Forty eight hours after the Federal Trade Commission announced that it was investigating AOL's instant messaging on potential antitrust grounds, the company has cobbled together a proposal for interoperability. AOL describes the "IMX Architecture" Internet draft as solving interoperability issues with "America Online's Instant Messaging Services" That's three paragraphs in, and we reckon, that's about the point that Federal lawyers stop reading. But from here on in it gets interesting, largely on the basis of what AOL has left out. AOL has for the first time acknowledged that other instant messaging networks exist. But that's about as far is goes. For example, AOL isn't documenting the wire protocol that clients need. The company currently maintains two such protocols, one a more or less functional protocol for the ICQ service, and an undocumented protocol for its AIM instant messanger. Rather, the draft describes a server-to-server protocol that allows postings made on other instant messaging services to be read by AOL's network, and vice versa. Despite a report over at CNet which suggests that the draft augurs "full interoperability between AOL's IM networks and competitors, data encryption, single-service registration, and the preservation of existing screen names" - the draft actually does nothing of the sort. Registration isn't even alluded to in the draft, leaving AOL the gatekeeper. In the world envisaged by AOL's draft, rival messaging services will be able to post messages to AIM or ICQ users, and vice versa, but the registration process and the client base remains with AOL. You ain't no buddy of mine Also, there's no guarantee that your chum on a rival network will show up on your buddy list. Where the weight of installed base is everything, this leaves AOL holding all the cards, as it effectively controls the user interface. There's no guarantee you'll be able to add an "alien" friend to your buddy list, as the protocol doesn't account for persistent IDs. Bearing in mind that AOL has a huge influence on the distribution channels, this effectively hands the 'Buddy List' business to the folk who have the existing user base, which is, er ... AOL. ®
Andrew Orlowski, 16 Jun 2000

AltaVista in High Court battle with British ISP

Further details have emerged concerning The Free Internet Group's (TFIG) High Court claim against AltaVista for alleged breach of contract. According to the claim issued at the High Court last week the two companies inked a three-year agreement on the 29th February 2000 for TFIG to provide "free" branded Net access for AltaVista in Britain. The service was due to be launched officially the following day. But according to the claim: "On and after 1st March 2000, [AltaVista] raised various queries with the TFIG as to technical matters and details relating to the Alta Vista Access Service." TFIG maintains it dealt with all of AltaVista's technical concerns and "has been, and continues to be, ready and willing and able to provide the Alta Vista Free Access Service in accordance with the agreement." On the 26th March 2000, AltaVista wrote to Christopher Whalen, the head of TFIG. It said: "As you know, our team has had continuing problems with Free Internet Group regarding quality and technical issues. The individuals there have not been responsive and we now believe that they do not have either the necessary expertise or level of staffing required to offer a high-quality Internet access service. As a result our team has lost confidence that you are in a position to deliver. We asked for certain deliverables and responsiveness earlier this month and did not receive satisfactory responses in order to proceed. In accordance with...the service agreement, we are terminating the agreement." The central plank of the legal action appears to be whether or not AltaVista was within its rights to walk away from a deal it had only signed days before. TFIG claims it was AltaVista who delayed the launch of the service and that TFIG carried out all the alterations and changes as requested by AltaVista. No doubt this will be disputed by AltaVista. TFIG claims to have lost profits from "advertising, sponsorship, premium rate telephone services, click revenue, registration and renewal fees, and other income" from the deal totalling £215 million over three years. According to the claim, TFIG wants AltaVista to honour the contract and to provide the names and details of all those who registered for the service, believed to be around a million people. TFIG claims this was part of a registration process jointly owned by the two companies. The British ISP is also looking to recover $15,000 for the "cost of the acquisition of a mail server". It is also seeking damages. No one from AltaVista was available for comment by press time. ® Related Stories British ISP sues AltaVista
Tim Richardson, 16 Jun 2000

Beckham hits the Net

Football ace David Beckham looks set to net more millions from a venture to flog sports gear online. The England player will get £1 million cash and a 2.75 per cent stake in the new dotcom. Through the deal he will get a site selling his own range of clothing, sports gear, toys and games over the Net. The venture will also see the involvement of fellow footballer Michael Owen, who will get £500,000 and a one per cent stake in the company, and Alan Shearer, who stands to earn £375,000 and 0.75 per cent. Other soccer stars believed to have been approached over the deal include Dwight Yorke, Emile Heskey and Graeme Le Saux, today's Daily Mirror reports. Profits from Beck's share in the company may boost his earnings higher than those of his pop star/catwalk model/TV interviewer wife Posh Spice. "David is already a massive name, but he's not yet capitalised on his popularity around the world," a source close the deal, which was negotiated between Beckham's sports management company SFX and Harvey Nichols boss Dr Dickson Poon, told the newspaper. "He is easily the biggest star of the lot who, with his looks and style, will be a huge money-spinner." David Beckham was this week seen giving a one-fingered gesture to abusive fans after they made remarks about his wife and son, Brooklyn. ®
Linda Harrison, 16 Jun 2000

T-Online ain't buying Freeserve – not yet, anyway

Deutsche Telekom's Internet unit, T-Online, has dampened the bid frenzy for UK ISP Freeserve by announcing a joint UK venture with One2One, a fellow DT subsidiary. One2One would not confirm that the companies were in discussions over a new service, but told The Guardian: "It is not unusual for both parties to talk to each other about various projects." T-Online must remain the favourite to buy Freeserve, so it could well be into clever negotiating mode here. To date, the world+dog has assumed the company will pay up to 6 billion to acquire Freeserve. This is a huge premium on what the British ISP was worth before Dixons announced it was to sell the company. By playing tough, T-Online may be able to ratchet the price down to more realistic levels. After all, it is not as if Freeserve has too many places to go. Also, this is the right time to sell this Pan-UK company. Next year, it will be worth much less. Californian Internet giant Yahoo! is planning a string of takeovers in the European market. "We will see similar consolidation opportunities in Europe as we did in the United States and you will see us being very opportunistic and aggressive," Yahoo! founder Jerry Yang told Reuters. The search engine company has just entered acquisition talks with online music service Myplay. Yahoo rival Lycos is currently being bought by Spain's Terra Network's. Online personal finance service Interactive Investor International warns it expects revenues in the second half of the year to show relatively modest growth compared to Q1 revenue due to a "significant decline in equity market activity worldwide". In a statement issued today, the company explained: "This has depressed transaction volumes and related revenues and, in particular, the revenues we derive from equity transactions, the retail placement of shares in initial public offerings and subscriptions. "In addition, capacity constraints suffered by many private client brokers earlier in the year have continued to affect broker sponsorships on our site and the revenues we derive from the construction and operation of equity trading systems has also been affected." Stephen Murphy, one of the top dogs at Richard Branson's Virgin, has jumped ship to run dotcom start up IP Powerhouse. Powerhouse, an Internet infrastructure company, has raised $60 million from investors including Deutsche Bank and CapVest, AIG's venture capital arm. Powerhouse plans to build five web hosting server farms across Europe, and will also provide switching and telecoms services. ®
Team Register, 16 Jun 2000

Red Hat out of the red in 2001 – CEO

Linux specialist Red Hat said it will start turning a profit sometime next year, following a sharp rise in the company's quarterly revenues. Reporting its Q2 2000 results, yesterday, Red Hat said its revenues rose 95 per cent year-on-year for the three months to 31 May, reaching $16.0 million from $8.2 million. Quarter-on-quarter growth hit 22 per cent - in Q1 Red Hat recorded revenues of $13.1 million. Red Hat's loss for quarter fell to $2.5 million, but that doesn't take into account acquisitions and other one-off expenses, which when added in take the Q2 2000 loss to $14.9 million. For the same period last year, Red Hat lost $14.1 million. Gross margins reached 54 per cent during the quarter, up 6.6 per cent on Q1. Essentially, Red Hat continues to spend in order to accrue, and the revenue growth the company is experiencing suggests the plan is working. From its beginnings as a Linux distributor, Red Hat now styles itself a specialist in "open source Internet infrastructure solutions", as it shifts its business to focus on the area of the open source world that can make money. So the company is targeting hardware vendors - most notably IBM, Dell and Compaq - to get its Linux distro installed on their servers on the back of which it can sell consultancy, support and other services. During the quarter, Red Hat beefed up its own support offerings with a an annual subscription-based 24x7 per-server product. Meanwhile, Red Hat is building up through acquisition and VC-style funding a stack of open source server management products and tools, again which can be used as a loss-leader to sell support and service products. The quarter's purchase of server performance software firm Bluecurve is a case in point. And it was bought with stock worth $33 million, so Red Hat hasn't had to touch its cash reserves. Red Hat's other line is to target the lucrative embedded market, primarily through its eCos Linux-based OS and Embedded DevKit software development package. Red Hat this week bought embedded developer WireSpeed, but the effects of the purchase won't be felt until Q3. Expect more acquisitions like WireSpeed and Bluecurve while Red Hat continues to spend money on developing its business. Provided revenues continue to grow at around 22 per cent a quarter - and there's no reason why they shouldn't - Red Hat should indeed be in a position to go into the black next year. President and CEO Matthew Szulik's target of profitability sometime "in calendar 2001" gives him plenty of room to manoeuvre to choose the best time to declare a profit. ®
Tony Smith, 16 Jun 2000

Maxtor go faster disks that aren't (any faster)

And what's this landing on our doorstep - a press release from Maxtor Europe trumpeting the shipment of Ultra ATA/100 drives. Dated June 6, the release arrived at The Register on June 15, showing a peculiar urgency on Maxtor's part. It's not as if Maxtor doesn't know how to jump the gun - in its release, the disk drive vendor announces its 60GB drives can now throughput 100MBp/s. But it turns out the drives could always handle this throughput, but Maxtor had to keep quiet about it, because Quantum owns the patents on the technology. So even if you own an "old" Maxtor Ultra ATA/66 you can download the firmware from the Maxtor Web site, and you can run it at 100MBp/s. Quantum has licensed the technology for use by other companies, but only made the specifications generally available of June 5. The company said in a statement: "Once licensing is executed, vendors other than Quantum can announce and begin shipping products that incorporate ATA/100 technology." The firmware download is only available for the DiamondMax60 and DiamondMax30 families, check out this link to see if your model is included in the list. As soon as the spec was made public, a flurry of new products started shipping featuring the ATA/100 technology, with stuff from Seagate as well as Maxtor.® Related story Linux beats Microsoft to support superfast disks
Lucy Sherriff, 16 Jun 2000

Roll-up for the Microsoft class action

Millions of Brits stand to get a refund from Microsoft if a £1 billion lawsuit due to be filed next week is successful. The action, one of around 130 pending against the software giant, will be filed by a bunch of solicitors on behalf of Windows customers that bought the software outside the US, the Guardian reports. It will be the first big test of a change in American law, which allows non-US citizens to claim damages as victims of monopolies, when it goes to the US district court in Maryland on Monday. The lawyers are members of the newly formed alliance Global Anti-Cartel Network, which is made up of 29 law firms spanning six continents. They claim Microsoft overcharged each user by at least £20, and aim to reclaim up to half the price customers paid for the software. And how much of that would end up in the customers' pockets, after those public service lawyers have had their fill at the trough? The European side of proceedings is headed by Michael Cover of Mishcon de Reya, the London law firm which acted for Princess Diana in her divorce from Price Charles. This week an Oregon judge ruled that consumers couldn't sue Microsoft for overpricing Windows because they didn't buy the software directly from the company. ® Related Stories MS beats rap in private lawsuit - only 136 to go MS tries to cut States out of Supreme Court appeal
Linda Harrison, 16 Jun 2000

Motorola, JVC to co-operate on wireless home video LAN

Motorola and Japanese consumer elecronics company JVC are to develop a wireless networking system for home entertainment kit. At this stage, little is known about the technology, other than the fact that it isn't Bluetooth, which isn't up to handling the data speed and volumes required to transmit full-screen, full-motion video - something the Motorola/JVC technology will provide. That suggests we could be looking at some kind of wireless IEEE-1394 (aka FireWire) network, something a number of Japanese consumer electronics, including Canon and NEC, have been experimenting with of late. FireWire is the consumer electronics world's home AV networking technology of choice, through individual company effors and group schemes like the Home AV Interoperability (HAVi) standard. JVC already offers wireless LAN products, based on 10Mbps Ethernet over an infrared link, designed for professional digital content storage networks. ®
Tony Smith, 16 Jun 2000

Get a £600 PC for £100… not quite

The site says "Click here for a free PC!!" and then the price starts rising. PC Help is actually offering a 500MHz Intel Celery PC for two years if you cough up £50 and answer market research questions once a month. But once you fill in the application form they stick you with an extra £50 for admin and P&P. If you want to keep the machine after two years you can hang onto it for another £50. The total is now £150. PC Help reckons it has 250,000 £600 machines to give out to UK households only. It plans to sell the research results and promises your personal data will be kept confidential and you will not be spammed if you take part. It is using a variety of hardware suppliers to source the kit but mentioned HP and Compaq as brands available. For your money you get 64MB Ram, 8.4GB hard drive, 8MB Video, modem, sound, stereo speakers and 15in monitor. The system comes with Windows 98 installed and the Lotus Smartsuite 'Millennium' edition. The kind of questions you'll have to answer are of the type: How many TVs do you have; Have you ever changed ISP; How many cars have you got; How long do you spend on the Internet? If you don't fill in your monthly form PC Help will come after you for the money less three per cent for each month you bothered to answer. Even at £100 for two years use it still sounds a little too good.®
Robert Blincoe, 16 Jun 2000

Home Office kept busy defending RIP Bill

Fielding opposition to the Regulation of Investigatory Powers (RIP) Bill is becoming a full-time job for the Home Office. This week Jack Straw made time to write a letter to the Financial Times to try and allay fears in the City that the Bill will be costly or drive business overseas. The Home Office also set up a special section on its Web site "devoted to dispelling some of the myths and misunderstandings that have been circulating regarding the Bill's provisions." This detailed online defence of RIP is almost as woolly as the Bill itself. For example, it dismisses the recent British Chamber of Commerce's claim that RIP could cost British industry £46 billion, saying the claims have "no foundation". Yet the Home Office has still to come up with a definite figure of how much the cost is likely to be. A fine and detailed analysis of these Home Office statements can be found at the FIPR Web site Trade and industry secretary Stephen Byers is also promising to add to the Home Office's workload. He is to lobby the government department to listen to business concerns, and yesterday hinted that the government may back down over certain aspects of the Bill. "We are aware of concern within the business community about some of the proposals in the measure," he told MPs during question time. "Which is why the home secretary has indicated he is more than willing to consult business about their concerns and, if necessary, the measure can be amended." The Bill is due its second session at the committee stage in the House of Lords on Monday. ® Related Story Straw hits back at RIP Bill critics RIP could wreck UK business, Chamber of Commerce realises
Linda Harrison, 16 Jun 2000

Gates has most wonga, says Forbes magazine

Bill Gates is still the best man to call if you are short of cash, despite tough competition from Larry Ellison. Gates hung on to the title of "World's Richest Man" by the skin of his teeth this year, according to the annual list of the "Worlds Working Rich" from Forbes Magazine. Forbes estimates wealth on the basis of share prices and foreign exchange rates as of May 22. Ellison smashed his way up from 30th to second place as his personal fortune skyrocketed this year from $9.5 billion to a massive $47 billion. The 500 per cent increase in the value of Oracle stock accounts for this vast leap, and even put him ahead of Gates earlier this year, while Microsoft's shares were suffering from Anti-trust fever. Paul Allen, Microsoft's co-founder finishes in joint third place, tied on $28 billion with former second ranker, Warren Buffet. The magazine, which published the list yesterday, also compiled a list of the world's richest Kings Queens and Dictators. The news is that it pays better to run Software monopolies/dictatorships (delete as appropriate) than it does to be a political dictator or Royalty. The Queen is worth a measly $450 million. Get coding Liz.®
Lucy Sherriff, 16 Jun 2000

Sub7 vid Trojan can launch distributed attacks

Last week we expressed doubts about a report from security outfit NETSEC, claiming that they had found a new Trojan capable of launching DDoS attacks. Their "new" Trojan turned out to be Sub7, a remote administration package which had been around for years, and which we deemed an improbable candidate for DDoS. After discovering first that NETSEC was wrong about the novelty of their discovery, and after assessing the relatively low threat Sub7 posed in the DDoS arena, we drew the natural conclusion that the company was yanking the media's chain for attention. Subsequent e-mail correspondence between The Register and NETSEC executives further persuaded us that the company did not have its facts straight, and was scrambling for after-the-fact validation of its original claims. Now we learn that NETSEC was on the right track after all, and if they had simply waited until they had a firm handle on their find instead of disgorging inaccurate data through the media in their rush to get attention, they might have spared themselves a significant PR cock-up, and won some serious props in the security community. As it turns out, the most recent build of Sub7 contains an undocumented feature which can indeed be used to ping the living hell out of Web servers, from numerous infected clients simultaneously, according to research just completed by security outfit iDefense. Sub7 has long used an IRC feature which logs the infected servers into an IRC channel of the operator's choosing, to notify the operator of which victims are on line. At that point the operator can log on to a victim's computer using the Sub7 client, and go about whatever remote administration tasks he had in mind. A later feature configured the IRC bots to listen for commands entered in the IRC channel, which would be executed simultaneously by all the victims logged into it. Now for the interesting bit: Although the Sub7 crew has decided not to document it, IRC bots in the new build will listen for and respond to ping and mping commands, iDefense Chief Scientist Sammy Migues told The Register. So, if one has managed to infect, say, a thousand victims, and could reasonably expect perhaps 250 of them to be on line together at any given time, one could run an mping command through all of them simultaneously. An attacker can choose a target IP; command the 250 victim machines to send say, one million packets of 64K each; and, voila, an instant, and distributed, ping flood. The complete iDefense report is posted here in PDF format, for those who wish to acquaint themselves with all the gruesome technical details. ®
Thomas C Greene, 16 Jun 2000